![](\"https:\/\/taxwhatifdoctor.com\/wp-content\/uploads\/Blog-Pic-2023.03.21.png\" "\\"Logical")
<\/a><\/div>Logical Tax Planning<\/a><\/span>It\u2019s hard to be logical all the time about everything. The most financially successful tax clients we serve at least attempt to force themselves to be logical, for their own benefit. For instance, our parents, as well as a subset of the economy including some popular radio show based advisors like Dave Ramsey, say you should pay off your home and have a \u201cfree and clear\u201d deed as a goal (they are wrong in most cases by the way).\u00a0That kind of thinking is emotional thinking, mixed perhaps with some presumptive attitude about what the general populous is capable of. \u201cWell, we know we can\u2019t get people to do what would really be best for them based on pure math and<\/p><\/div><\/li>
<\/a><\/div>Non-qualified Accounts As Tax Planning Tools?<\/a><\/span>When people save for retirement they almost automatically use accounts that avoid tax now. IRAs, 401(k)s, 403(b)s, 457s, all pretax retirement savings plans. Certainly, long term savings uninterrupted by withdrawals and the effect of compounding interest on interest earned is unarguably valuable, but doing that in pretax accounts is NOT the only way to have that happen! Non-qualified annuities and Roth IRAs allow the same mechanics of compounding to happen, and in retirement both can be as valuable depending on the circumstances and actions of the retiree. Annuities are underappreciated as a tax planning tool, because of the way earnings are treated as ordinary income upon withdrawal. However if annuitized at retirement (an option the advisors that distribute them don\u2019t<\/p><\/div><\/li>
<\/a><\/div>Overlooked Opportunities<\/a><\/span>An often overlooked tax savings opportunity comes from not fully understanding how you can use your cars as a deduction on your tax return.\u00a0It is very common for people who have a Schedule C sole proprietor type business to claim their mileage on automobiles. But the privilege of using personal deductions on a tax return is not limited to someone who is filing a Schedule C.\u00a0 For instance, a landlord might own three apartment buildings and file a schedule E on his personal tax return and not feel like he is \u201cself-employed\u201d as he has a full-time W-2 job. However, the use of his personal car on that schedule E is just as deductible as it is for the Schedule<\/p><\/div><\/li>
<\/a><\/div>Tax Planning and Estate Planning Are a Lot Alike, and Ignored By Most!<\/a><\/span>People try, but \u201cadulting\u201d is hard! \u00a0Kids, pets, job, relatives, friends, bills, medical problems, car problems, work problems all in the last day, so when I have time I will start tax planning.\u00a0 Same as\u2026.so when I have time I will start estate planning, it\u2019s just so far down on most peoples\u2019 day to day list of things to do that all the other issues just cycle in some complex order that nobody understands and the last two items never seem to bubble up to the top\u2026UNTIL THEY DO! If you are a business owner, thoughts of tax planning might bubble to the surface a couple times a year, perhaps March 15th and April 15th (or later if you have<\/p><\/div><\/li>
<\/a><\/div>Tax Planning: It Isn\u2019t Just For Breakfast Anymore<\/a><\/span>All around the country, there are people in an absolute panic because the real tax deadline for personal tax return\u00a0extension filers is approaching and they\u00a0are running out of time.\u00a0The exception would be for those who have been affected by flooding or other natural disasters and may be given an extended deadline by the IRS.\u00a0Those people may now have additional time to file, but would need to check the IRS website to see if they are in an affected area recognized by the IRS and would be covered by the exception.\u00a0For the rest of us extension filers, there are some choices that need to be made quickly.\u00a0The deadline is just a few weeks away.\u00a0You\u2019re not ready. What do you do?\u00a0 The<\/p><\/div><\/li><\/ul> <\/div>